Using Dictation to create transcripts

I'm trying to use the Dictation feature of MacOSX to create transcripts of videos we record for faculty. At the moment I am using Mavericks on a MBPro, I've installed JackOSX and can get VLC to send a signal to the Dictation engine. I can see the purple level indicator moving up and down in relation to the audio coming from the video in VLC. However the sound is muted and no dictation occurs. I had set the input device in the Dictation preferences panel to Jack Router which seems key in getting the audio signal into the Dictation engine. And when I switch back to internal microphone, the dictation appears to work fine.

I tried QTPlayerX as well, but Jack doesn't list it.

I'd like to find a way to get this to work. I'm not afraid of digging around with a Terminal or even creating my own application using the Dictation API if one exists, I just need some pointers. This is so close to working, can anyone help me with the last mile?

thanks

Michael